The development of effective vascular therapies requires the understanding of all modes of vessel formation contributing to vasculogenesis, angiogenesis (here termed hemangiogenesis) and lymphangiogenesis. We show that lymphangiogenesis proceeds by blind-ended vessel sprouting via recruitment of isolated endothelial progenitor cells to the tips of growing vessels, whereas hemangiogenesis occurs by non-sprouting vessel expansion from the capillary network, during middevelopment in the quail chorioallantoic membrane (CAM). Blood vessels expanded out of capillaries that displayed transient expression of alpha smooth muscle actin (alphaSMA), accompanied by mural recruitment of migratory progenitor cells expressing SMA. Lymphatics and blood vessels were identified by confocal/fluorescence microscopy of vascular endothelial growth factor (VEGF) receptors VEGFR-1 and VEGFR-2, alphaSMA (expressed on CAM blood vessels but not on lymphatics), homeobox transcription factor Prox-1 (specific to CAM lymphatic endothelium), and the quail hematopoetic/vascular marker, QH-1. Expression of VEGFR-1 was highly restricted to blood vessels (primarily capillaries). VEGFR-2 was expressed intensely in isolated hematopoietic cells, lymphatic vessels and moderately in blood vessels. Prox-1 was absent from endothelial progenitor cells prior to lymphatic recruitment. Although vascular endothelial growth factor-165 (VEGF(sub 165)) is a key regulator of numerous cellular processes in hemangiogenesis and vasculogenesis, the role of VEGF(sub 165) in lymphangiogenesis is less clear. Exogenous VEGF(sub 165) increased blood vessel density without changing endogenous modes of vascular/lymphatic vessel formation or marker expression patterns. However, VEGF(sub 165) did increase the frequency of blood vascular anastomoses and strongly induced the antimaturational dissociation of lymphatics from blood vessels, with frequent formation of homogeneous lymphatic networks.